How To Get Business Auto Loan Without Personal Guarantee?

A business auto loan without personal guarantee protects lenders by reducing their risk if the loan isn’t repaid. It’s a common requirement, but some lenders may waive it based on their policies.

Signing a personal guarantee can improve approval odds and lead to better interest rates and terms. However, some business loans don’t require one.

Eligibility depends on factors like business financial strength, available collateral, lender policies, and company history.

What Is a Personal Guarantee on a Business Loan?

A personal guarantee is a promise you make when taking out a business loan. It means that if your business can’t pay back the loan, you will personally be responsible for repaying it.

By signing a personal guarantee, you’re acting like a cosigner for your business. This means that if your business fails to pay, the lender can go after your personal assets, like your savings or property, to recover the money.

Most business loans require a personal guarantee, even unsecured loans. In many cases, if you own at least 20% of the business, the lender will ask you to sign one.

Read more: Can You Pay Auto Loan Off Early?

Business Loans Without a Personal Guarantee

Loan Type	How It Works	Collateral Requirement	Example Lenders
Term Loans	Provides a lump sum upfront, repaid over time with interest.	May require strong business or personal collateral instead of a personal guarantee.	Varies by lender, negotiable with strong assets.
Lines of Credit	Revolving credit line; borrow, repay, and reuse as needed.	Often secured by a lien on business assets instead of a personal guarantee.	Wells Fargo Prime Line of Credit
Equipment Loans	Financing specifically for purchasing business equipment.	The equipment itself serves as collateral, reducing the need for a personal guarantee.	Triton Capital
Merchant Cash Advances (MCAs)	Provides an advance on future sales, repaid through daily deductions.	No personal guarantee, but may require a Uniform Commercial Code (UCC) lien for large amounts.	Credibly (no PG for deals under $200K)
Invoice Financing & Factoring	Uses unpaid invoices as collateral; factoring involves selling invoices to a third party.	Focuses more on customer creditworthiness rather than a personal guarantee.	Varies by lender.

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Top Business Auto Loans Without a Personal Guarantee

Getting a business auto loan without a personal guarantee isn’t easy, but it’s possible if you have strong business finances and the right lender.

While most lenders require a personal guarantee to protect themselves, some are willing to approve loans based on your business’s credit history, assets, and financial strength.

Here are some of the best options for securing a business auto loan without a personal guarantee.

1. Ally Bank

Ally Bank offers a variety of commercial auto financing solutions, making it one of the more flexible lenders when it comes to waiving personal guarantees.

• Retail Financing: Traditional auto loans for new, used, and certified pre-owned (CPO) vehicles, with terms up to 75 months.

• SmartLease: A closed-end lease that requires returning the vehicle at the end of the term. Available for 12 to 60 months.
• ComTRAC Lease: An open-end lease where you take responsibility for the vehicle’s residual value. Terms range from 12 to 72 months.
• Commercial Line of Credit: A revolving line of credit designed for businesses looking to build a fleet, valid for one year with renewal options.

2. Ford Pro™ FinSimple™

Ford offers several financing options for commercial vehicles, often without requiring a personal guarantee.

• Commercial Vehicle Financing: Term loans for new, used, and CPO Ford vehicles. Loan terms range from 12 to 84 months.
• CommerciaLease: An open-end lease that covers a wide range of vehicles, from cars to heavy-duty trucks.
• Commercial Red Carpet Lease: A closed-end lease for new Ford vehicles.
• Commercial Line of Credit: A revolving credit line that stays open for one year, with the option to renew.

3. PNC Bank

PNC offers straightforward business auto loans with fixed rates and terms up to 72 months. You can finance up to 100% of the vehicle cost, including taxes and fees.

• Loan amounts: $10,000 to $250,000
• Eligibility: At least two years in business and a debt-to-income ratio of 40% or lower.

While PNC usually requires a personal guarantee, businesses with strong financials and credit may qualify without one.

4. Toyota Financial Services

Toyota Financial Services specializes in financing for Toyota vehicles and offers flexible terms.

• Finance Plans: Loans for new, used, and CPO Toyota vehicles, with seasonal payment plans and balloon financing available in some states.
• Business Lease Plan: A closed-end lease for new and CPO Toyota vehicles, with terms up to 60 months.
• Vehicle Credit Lines: A prequalified revolving credit line valid for 12 months.

5. GM Financial

GM Financial provides a range of business auto financing solutions, including loans, open-end leases, closed-end leases, and revolving credit lines.

• Commercial Purchase Financing: Term loans for Chevrolet, Buick, GMC, and Cadillac vehicles, with terms up to 84 months.
• Open-End Leases: Flexible lease terms from 24 to 60 months, with no mileage restrictions.
• Closed-End Leases: Predictable-payment leases for businesses.
• Commercial Line of Credit: Starts at $350,000 and is reviewed annually.

GM Financial allows personal guarantee waivers, especially for leases.

6. Nissan Business & Fleet

Nissan provides business auto loans, leases, and credit lines for purchasing or leasing Nissan vehicles.

• Purchase Financing: Recommended for businesses planning to keep their vehicles for more than four years.
• Signature FLEX Lease: A closed-end lease with annual mileage options from 5K to 15K.
• TRAC Lease: An open-end lease that lets you purchase the vehicle at the end of the term.
• NMAC Line of Credit: A revolving credit line with no administrative fees.

Nissan states that personal guarantees may be negotiable depending on business qualifications.

7. Bank of America

Bank of America’s Business Advantage Auto Loan is a solid option for purchasing or refinancing business vehicles.

• Eligibility: Minimum two years in business, a vehicle valued at least $10,000, and fewer than 75K miles.
• Loan Terms: Fixed rates with a 30-day rate lock guarantee.
• Equipment Loans: Available for commercial vehicles over 2.5 tons, with terms up to five years.

While Bank of America typically requires a personal guarantee, businesses with strong financials may be able to avoid it.

Read more: Best Low Interest Auto Loans For Students in 2025

8. Truist Bank

Truist Bank provides traditional business auto loans for new and used vehicles, with financing up to 100% of the purchase price plus additional costs.

• Loan Terms: Up to 75 months
• Maximum Loan Amount: $250,000
• Rate Lock Guarantee: 30 days

Truist usually requires in-person applications, but businesses with strong credit and financials may qualify for loans without a personal guarantee.

How to Avoid Signing a Personal Guarantee

While it’s not always easy, you can avoid signing a personal guarantee by exploring other ways to reduce the lender’s risk.

Establish a Separate Legal Business Structure

Set up your business as a corporation or LLC, which helps create a clear distinction between your personal and business finances. This allows your business to build its own credit and shows that its ability to repay the loan depends on its own revenue and assets, not yours personally.

Build Strong Business Credit

If your business has a good credit history, it can reduce the lender’s risk, increasing your chances of avoiding a personal guarantee. To build this credit, you might need to start with a loan or credit card that requires a personal guarantee, but over time, a strong credit profile will help. Make sure your business has a D-U-N-S number with Dun & Bradstreet to track your credit progress.

Offer Valuable Business Assets as Collateral

Using high-value assets, like real estate or expensive equipment, can help offset the lender’s risk. If the collateral is worth more than your personal assets, lenders may be more likely to waive the personal guarantee. If not, you may be able to negotiate with the lender to avoid the requirement.

Final Thoughts

Getting a business auto loan without a personal guarantee is possible, but you’ll need strong business credit, solid financials, and the right lender. While Ally Bank and Ford Pro™ FinSimple™ tend to be more flexible, others like PNC and Bank of America have stricter requirements. Before applying, review lender criteria and make sure your business meets the necessary qualifications to improve your chances of approval.

FAQs

Q1. How to build business credit without personal guarantee?

1. Monitor your business credit reports regularly.

2. Set up your business as a legal entity.

3. Obtain an EIN and open a business bank account.

3. Apply for a business credit card.

5. Establish trade lines with vendors that report to credit bureaus.

6. Make all payments on time.

Q2. Can a personal loan be used for auto?

Yes, a personal loan can be used to buy a car, offering flexibility in where you purchase the vehicle. However, personal loans usually come with higher interest rates than auto loans and may have shorter repayment terms. Unlike auto loans, personal loans are unsecured, meaning you don’t have to put up the car as collateral. Compare both options to find the best deal based on your credit and financial situation.

Q3. Why do lenders require a personal guarantee?

Lenders require a personal guarantee to protect themselves in case your business can’t repay the loan. If your business defaults, they can take your personal assets to help recover their losses. By signing a personal guarantee, you also show the lender that you’re personally committed to your business’s success, making them more confident that you’ll make your loan payments.